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Trustee liability and protection in pensions—checklist

Trustee liability and protection in pensions—checklist Forms of protection • Trustees can be protected from personal liability by: ◦ exoneration clauses ◦ indemnity clauses ◦ insurance ◦ statute Exoneration clauses • An exoneration clause, if effective, will mean that a trustee is exonerated (ie not personally liable) for acts or omissions which are covered by the clause. • Trustees should ensure that an exoneration clause is worded as widely as possible. • Exoneration clauses are construed strictly. • The burden of proof is on trustees to show that an act or omission is covered by the clause. • Exoneration clauses will not exonerate trustees from liability for fraud, dishonesty or deliberate breach of trust. • Exoneration clauses apply to former trustees as well as current trustees. • An exoneration clause in a scheme's trust deed and rules will not protect trustees from liability to persons who are not a party to the trust. Indemnity clauses • Indemnity clauses provide that claims for liability against trustees will be met by another...

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Pay and wages

Pay and wages This Practice Note examines the nature of pay, including the employer’s duty to pay wages or salary, the ‘work/wages bargain’ and the effect of factors such as sickness, unwillingness to work and absence from work for other reasons. It considers how the amount of wages is regulated and outlines an employee’s right to an itemised pay statement and remedies where there is a failure to pay wages. Interaction of common law and statutory rights The essence of employment is pay in return for work; the employer's obligation to provide consideration for the individual’s work and skill in the form or a wage or other remuneration is generally regarded as a fundamental ingredient of a contract of employment, as set out in Ready-Mixed Concrete (see Practice Note: Employee status—Determining whether an individual is an employee: overview). Duty to pay wages There is a duty to pay wages whenever an employee is ready, willing and able to work. For more detailed information on how this...

Financial assistance—fundamentals

Financial assistance—fundamentals Whenever any acquisition of a company’s shares is contemplated, careful consideration should be given as to whether the statutory prohibition on the giving of financial assistance applies. What is the prohibition on the giving of financial assistance? The Companies Act 2006 (CA 2006) prohibits: • a public company (or a subsidiary of it, whether a public or private company) from giving financial assistance directly or indirectly for the purpose of: ◦ the acquisition by a person of that public company's shares, whether the assistance is given before or at the same time as the acquisition takes place, or ◦ reducing or discharging a liability incurred for the purpose of acquiring that public company’s shares, where the shares have been acquired by a person (and whether or not the liability was incurred by that person or someone else) • a public company, which is a subsidiary of a private company, from giving financial assistance directly or indirectly for the purpose of: ◦ the acquisition by a...

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Trust for a disabled person—discretionary

Trust for a disabled person—discretionary This TRUST is made on [date] Parties 1 [settlor] of [address] (the Settlor) and 2 [original trustees] of [addresses] (the Original Trustees) Background (A) The settlor wishes to make this Trust and has transferred to the Original Trustees the assets described in Schedule 1 to be held on the following trusts. (B) The Principal Beneficiary is a disabled person within the meaning of that term in the Finance Act 2005, Schedule 1A. This Deed PROVIDES: 1 Definitions and interpretation In this Trust: 1.1 Discretionary Beneficiaries • means (a) any spouse or [widower OR widow] whether or not remarried of the Principal Beneficiary; (b) the descendants of the Principal Beneficiary; (c) the spouses, widows or widowers (whether or not remarried) of the descendants of the Principal Beneficiary; 1.2 Principal Beneficiary • means [disabled person]; 1.3 spouse • shall include a civil partner registered under the Civil Partnership Act 2004 and a spouse of the same sex, and a person is a...

Director’s questionnaire—secondary offers

Director’s questionnaire—secondary offers Private and confidential [Insert company name] (Company) Introduction Director's questionnaire For completion by [insert date] This questionnaire has been prepared in connection with the proposed [placing OR open offer OR rights issue] of [insert amount] ordinary shares of [insert nominal value] pence each in the capital of the Company (Ordinary Shares) and the proposed application for admission of the Ordinary shares to [listing on the Official List of the Financial Conduct Authority and to trading on the market for listed securities operated by London Stock Exchange plc OR trading on AIM] (Admission). This is an important document and you should answer all questions truthfully and without omissions. Please answer all questions fully and if insufficient space is provided please provide additional information on a separate sheet of paper duly signed, dated and attached to this questionnaire. If a question is answerable in the negative, please answer 'No'. Do not leave any section blank. In this questionnaire, the term 'company' includes any...

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When appointing trustees of a minor beneficiary's legacy under section 42(1) of the Administration of Estates Act 1925, does the executor have a duty to ensure that the legacy is not paid to the trustees’ own bank account?

When appointing trustees of a minor beneficiary's legacy under section 42(1) of the Administration of Estates Act 1925, does the executor have a duty to ensure that the legacy is not paid to the trustees’ own bank account? When appointing two trustees to receive a legacy for a minor who is absolutely entitled under section 42(1) of the Administration of Estates Act 1925 (AEA 1925), personal representatives (PRs) receive a good discharge and are freed from all further liability in respect of the legacy. AEA 1925, s 42(1) permits the PRs ‘to do any assurance or thing requisite for vesting such devise, legacy, residue or share in the trustee or trustees so appointed’ and that ‘the same may be retained in its existing condition or state of investment, or may be converted into money, and such money may be invested in any authorised investment’. There is no positive duty on the PRs under AEA 1925, s 42(1), to ensure that the legacy is not paid into the trustees’...

Lay executors are claiming in negligence against and/or challenging the interim bills of solicitors they previously instructed to carry out the estate administration. Can the executors claim for their legal costs in bringing the claims? Are they a legitimate expense of the estate administration? To what extent would they be able to claim the costs pre-action if there is a settlement?

Lay executors are claiming in negligence against and/or challenging the interim bills of solicitors they previously instructed to carry out the estate administration. Can the executors claim for their legal costs in bringing the claims? Are they a legitimate expense of the estate administration? To what extent would they be able to claim the costs pre-action if there is a settlement? The executors’ role The Administration of Estates Act 1925 (AEA 1925) states that personal representatives (PRs) must: • collect and get in the deceased’s estate • administer it according to the law and with due diligence For guidance on the role and the powers of the personal representatives, see Practice Notes: Definition of a personal representative and Personal representatives—powers, duties and remuneration. For guidance on the liability of personal representatives, see Practice Note: Personal representatives—liability. Failure to bring a claim against professional advisors in circumstances where a claim ought to be brought could result in an action brought by the beneficiaries against the personal representatives for breach of trust/devastavit....

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Private Client weekly highlights—22 May 2025

This week’s edition of Private Client highlights includes: (1) the Law Commission publishes its recommendations to reform the Wills Act 1837; (2) Mr and Mrs K v Mr and Mrs Z, in which the court granted a parental order despite applicants’ advanced ages; (3) HMRC issues first individual tax avoidance stop notices under POTAS regime; (4) further analysis of Accuro Trust (Switzerland) SA v The Commissioners for HMRC, in which the court confirmed when a settlement is ‘made’ for the purposes of excluded property; (5) Louwman v Revenue and Customs Commissioners, a decision of the FTT holding that OIGs and AIPs arising in offshore protected trusts are not protected foreign source income; (6) Moran v Revenue and Customs Commissioners, where the taxpayer was found liable under the transfer of assets abroad regime for the rent-free occupation of a house; and (7) the Data (Use and Access) Bill reaches its final legislative stages.

To disclose or not to disclose? Brazil’s unsettled case law on arbitrators’ duty of disclosure (Orion v Engie)

Arbitration analysis: Reversing a first-instance judgment, the Court of Appeals of the State of São Paulo annulled an arbitral award after concluding that one of the co-arbitrators breached his duty to disclose that he had previously served in another arbitral tribunal with one of the attorneys for the prevailing party. The court held that, under Brazilian law, arbitrators’ duty of disclosure is objective and continuous, and failure to reveal facts capable of creating a ‘reasonable doubt’ as to an arbitrator’s impartiality and independence suffices to vitiate the award, even in the absence of evidence of actual bias. This decision is significant for arbitration practitioners, as it occurs during a period of heightened scrutiny regarding arbitrators’ disclosure obligations in Brazil. Written by Renato Stephan Grion, partner at Pinheiro Neto Advogados, and Guilherme Piccardi, senior associate at Pinheiro Neto Advogados.